The Competition Authority won’t be pleased, and everyone else will be highly sceptical, but the three main stockbroking firms, NCB Davy and Goodbody, came together to produce a report that is worth a look (of course, it’s self-serving, they’re stockbrokers )
There’s no shortage of ideas for cutting everyone else’s pay and benefits, including social welfare
The most significant part deals with the banks and gives what seems to be reasonable estimates of the capitalisation requirements. The stockbrokers’
. So, loan losses of €25bn now, and more to come depending on how things develop after 2010.
The report also gives a fair summary of the objections to a “bad bank”. It makes a sensible suggestion about the funding from the NPRF. Now that our pensions are in hock to the bank, there’s no point in the NPRF borrowing more money to support the banks:
The graph on p. 9 shows the trend in current expenditure and tax revenues. Tax revenues actually fell as a % of GNP from 1994 to 2000 and fell well below current expenditure in the late 1990s (due to tax cuts, I think). Spending climbed sharply in recent years, particularly from 2006 - 2008 while revenues nose-dived (take a bow, Brian Cowen).
Given that the report was written by a bunch of people who completely failed to predict the inevitable housing and economic slump it is not a bad report. Indeed, they do put forward a plan for righting the state’s finances that does not involve further subsidies for the construction industry.
An thats because the majority of their business probably didnt come from builders who were too busy throwing up shoeboxes and selling for extortionate prices to be bothered investing through stockbrokers and the stockbrokers were too busy giving advice to credit unions anyway.